The two facilities at Leyland near Preston and Thornton near Blackpool are part of the £2 billion 25-year contract that was signed with Australian-firm Global Renewables.
Both facilities will use the Global Renewables UR-3R process that uses a combination of technologies to separate municipal solid waste into recyclable fractions, create compost and recover energy.
Global Renewables managing director David Singh said: This is a very significant PFI which will revolutionise the way waste in handled in Lancashire. The county has chosen an innovative and forward thinking approach, which will set the standard for all other local authorities. That we are on target is very good news for the county and a reflection of the dedication and hard work that has been put into delivering the contract.